Jeff Stankiewicz

“The bottom line is down where it belongs – at the bottom. Far above it in importance are the infinite number of events that produce the profit or loss.”

-- Paul Hawken

Leaders sometimes choose to be penny-wise and pound-foolish. While focusing on short-term bottom-line results, leaders can overlook the time and effort being wasted elsewhere—all in the name of saving a few dollars. Instead, we should take care of the small needs of employees and leverage their innate creativity and problem solving capacity toward achieving the organization’s goals.

Employees are innate problem solvers

Recently, we had the privilege of working with a manufacturing company to improve its processes. While there, we observed an internally-made door handle that led to the break room of this manufacturing facility. This door handle says a tremendous amount about the leadership structure – the former structure – that was in place when the door handle was made.

Because management did not want to spend the $20 or so that would be required to purchase a replacement door handle, employees utilized their creativity and initiative to develop a door handle that met their needs. They developed the design, searched forall of the pieces of material needed, cut all the pieces to size, welded it together, ground the rough edges, and anchored it to the door.

Channel initiative and creativity into what matters

When leadership wouldn’t replace the door handle, employees decided to solve the problem themselves. This illustrates natural inventiveness and adept problem solving abilities.However, this misdirected resolve could have been channeled into improving process performance and better delivering value to customers. Rather than having the challenge of employees that are disengaged, this manufacturer already had employees seeking ways to employ their creativity—if they had been offered the opportunity. How much time and effort was utilized to make this door handle? How much did it cost the company in terms of labor hours, compared to simply purchasing a replacement? What if this energy had been applied to what really mattered to the organization?

Where are your ‘door handles’?

Think about your organization. Where are your ‘door handles’? Are your employees focused on problems that could be solved by spending a few pennies? Could their time and talent be better-utilized on things critical to the organization? Please share your examples in the comments below.

Lessons Learned

“Problem solving is the purpose of any organization” -- Karen Martin

Oftentimes, organizations choose to label problems as opportunities. They view the word ‘problem’ as being negative, so they hypothesize that by switching words and using ‘opportunity’ instead, they will create a more positive environment that motivates employees to take action. However, in our experience, framing problems as ‘opportunities’ actually slows the rate of improvement. We believe a problem should be called a ‘problem’.

What is the problem with using the word ‘problem’?

The word ‘problem’ carries with it a negative connotation. Problems are deemed as inherently bad within the workplace and can become vilified. Employees may dread identifying problems because they fear a ‘shooting the messenger’ mentality. Because of this fear and negativity, organizations utilize the word ‘opportunity’ to eliminate the baggage associated with ‘problems’. Our position is that rather than dwelling on the number of problems, organizations should focus on problem solving.

What is the problem with using the word ‘opportunity’?

The word ‘opportunity’ has a more positive vibe, however it fails to impart a sense of urgency. An opportunity is something that knocks on your door and offers you a possibility. You may choose to pursue it or not, depending on how busy you are and how intriguing it is. By contrast, calling something a ‘problem’ changes the perspective. Problems should be fixed as soon as possible, before they occur again. Addressing them is not an option.

Concentrate on problem solving not problems

Taking things a step further, we believe the use of the word ‘opportunity’ is a symptom of an organization not having the proper perspective when it comes to continuous improvement. Organizations should not obsess over the number of problems occurring, but should instead transition their focus to the number of problems resolved. This seemingly subtle shift removes much of the negative connotations related to the word ‘problem’. Problem solving is about continually improving and making things better. Solving problems is a positive experience that people take pride in being a part of.

Of course, problems cannot be addressed until they’re first identified. Lean’s fundamental tenet of visual management serves this purpose by making problems readily visible to everyone, creating a positive tension that drives the need for rapid problem solving. Lean cultures don’t view problems as negatives, instead they are valued because they show when and where problem solving should occur to drive the most benefit.

Lessons Learned

-- Dr. Seuss

Problem solving is at the heart of Continuous Improvement. And, effectively solving problems often requires creative, innovative, and inventive ideas. So, how do we generate these innovative ideas? In this post, we review two methods for developing insightful ideas – an analytical approach and the more random “aha” approach.

Analytical Approach In our experience, problem solving teams typically employ methods that rely primarily on ideas generated through an analytical approach governed by the logical, linear thinking of the left side of the brain. This portion of the brain allows individuals to process information in sequence, one step at a time. For example, the left brain is relied on heavily during “if-then” thought processes, such as solving mathematical problems.

Via this approach, teams get together with the goal of quickly generating ideas through brainstorming sessions. These sessions can sometimes be augmented with creative idea generation techniques (e.g. random word, challenging assumptions, Edward de Bono Six Thinking Hats, etc.). While these sessions may produce many ideas, they are rarely truly innovative. Instead, they typically cultivate ideas that are “inside the box”.

Insightful “Aha” Approach While teams may utilize an analytical approach, if you want really creative ideas, don’t ignore the power of insight. These “aha” insights rely on the right side of the brain, the hemisphere that processes information both holistically and randomly, starting with a ‘big picture’ approach to solving problems. Thomas Edison, one of the most famous inventors of all-time, utilized a unique and insightful method to capture his flurry of ideas – even when on the verge of sleep.

While he wasn’t aware of the neuroscience underpinnings of the approach, Edison recognized the value of these ideas and strived to capture potentially fleeting thoughts. Because of his devotion to his work and new inventions, Edison slept very little. However, when he did sleep, he napped sitting in a chair, with his arms draped over the sides, holding a steel ball in each hand. Before sleeping, he would place a metal pan on each side of the chair. If he fell asleep too deeply, the balls would fall into the pans and make a noise, awakening him and allowing him to capture any ideas before they were once again lost. This unique method, along with hard work and dedication, allowed Edison to be the patent holder for 1,093 patents – a feat that illustrates a consistent creativity and dedication to his work.

How Insight Occurs While insight appears to occur suddenly and randomly, neuroscience studies have shown that it actually occurs through a process. Without delving too much into the scientific details, the brain shows a spike in alpha waves (one of the four basic types of brain waves) immediately prior to insight. Alpha waves increase when the eyes are closed, when “zoning out”, or during meditation. Studies indicate that this allows the Anterior Cingulate Cortex (ACC) – an area of the brain that is massively connected to other areas of the brain – to synthesize less obvious solutions made up of components pulled from numerous other areas of the brain. This process results in the sudden “aha” revelation.

Incorporating Insight Into Idea Generation It’s important for leaders to recognize the importance of incorporating insight into idea generation. One thing that can help propel this approach is to ensure individuals are in a positive, “light” mood during idea development. Studies show that subjects in a positive mood tend to solve more problems with insight.

In this post, we explore the intertwined relationship between the two fundamental components of the next generation continuous improvement (CI) model, which we have labeled as ‘Ingrained Excellence’. A CI approach that builds upon the proven and most effective tools, methods, and concepts; delivers rapid and lasting results; ensures appropriate focus and organizational alignment; and fundamentally ingrains CI into the organization’s culture.

The two components are ‘Strategic Improvement’ and ‘Daily Performance Leadership’.

Strategic Improvement Commonly, organizations start deploying CI to drive short-term measurable improvements that directly impact bottom-line performance. Executive teams identify and prioritize key opportunities to help achieve strategic objectives, close gaps in financial performance, and improve customer satisfaction. Projects are then launched and executed to address the key opportunities, often in the form of Lean Six Sigma DMAIC projects or Kaizen (Rapid Improvement) Events.

When properly executed, these projects often deliver the desired results – at least in the near-term. However, as we have discussed in previous blog posts, they drive episodic improvement rather than continuous improvement. Additionally, the results delivered by projects often wane over time, once the focus moves onto the next high-priority issue. Top-down projects are an important component of Ingrained Excellence, helping to deliver significant step-function improvement, but they are not sufficient on their own.

Daily Performance Leadership (DPL) DPL combines Leader Standardized Work, Visual Management Boards, and Daily Accountability Meetings into an ongoing system that ingrains problem solving and continuous improvement into the daily work of everyone, at all levels of the organization. It engages all workers in the delivery of a steady stream of numerous incremental improvements, as well as ensures an unwavering focus on maintaining a high level of process performance, helping to sustain the improvements delivered by project teams.

DPL demands fundamental changes to leadership behavior and the financial payoff of the small incremental improvements is difficult to quantify. For these reasons it is typically not the starting point of most CI deployments, but DPL is a critical component for maintaining long-term momentum and making CI a fundamental component of ‘the way’ work gets done.

The Relationship Between Strategic Improvement and Daily Performance Leadership Ingrained Excellence requires a blend of both project based Strategic Improvement and DPL, working in concert, to deliver a holistic blend of short-term results and lasting cultural ingrainment of continuous improvement.

At this point it should be noted that a handful of organizations utilize strategic deployment approaches, such as the 4 Disciplines of Execution (4DX). We currently classify this type of approach under the Strategic Improvement umbrella, because it helps deliver shorter-term, top-down, step-function improvements. But it can also serve as a vehicle to begin fostering the ongoing collective routines and individual habits that lead to CI becoming a deep-rooted part of the organization’s culture. Like top-down projects and DPL, it can play a critical role, but it is not sufficient on its own.

Staying focused on Strategic Improvement and DPL, the following table shows how the two approaches form a necessary complementary relationship, leading to Ingrained Excellence:

“Resistance is thought transformed into feeling. Change the thought that creates the resistance, and there is no more resistance.”

-- Robert Conklin

Lack of stakeholder buy-in is one of the most common project failure modes. It can result in longer project timelines, sub-par project results, and changes not being sustained in the long-term. Fortunately, performing a Stakeholder Analysis early on in a project allows challenges to be addressed proactively, before they hinder project success.

Stakeholder Analysis

Stakeholder Analysis is an important project management tool used to manage risk related to stakeholder buy-in issues. It is a tool to identify all parties – persons, departments, or organizations – who may have influence upon a project and take the necessary steps to manage their interests and expectations so that the project runs as smoothly as possible. While the traditional Stakeholder Analysis method adds value, simply by fostering the proactive management of stakeholder buy-in, there are a couple of gaps: Gap 1: A stakeholder’s attitude toward the project is determined on a consensus best guess – based on tribal knowledge – of their emotional position relative to the change.

Unfortunately, there is no defined criterion to assess why they may or not be invested in the project; it’s just “yes” or “no.”

Without more defined criteria to consider when assessing degree of buy-in, there is increased risk in a misdiagnosis and unexpected (potentially damaging) stakeholder behavior later in the project.

Gap 2: When High-Influence Resister stakeholders are identified, there is no guidance on how to effectively manage them.

Our Suggestion for Improvement

To improve project management outcomes and stakeholder buy-in, we recommend augmenting the traditional Stakeholder Analysis tool with the neuroscience-based SCARF model. This model provides a more structured and science-based approach to assessing stakeholder buy-in toward changes resulting from the project. In addition, it fosters the development of a more effective plan for increasing buy-in where necessary.

What is SCARF?

SCARF, developed by David Rock and based on hundreds of neuroscience studies, is a pneumonic that stands for Status, Certainty, Autonomy, Relatedness, and Fairness. This is a brain-based model for collaborating with and influencing others and is based on the overarching organizing principle of the brain to ‘minimize danger and maximize reward.’ Therefore, if a SCARF element increases, the brain’s approach to the response increases. Likewise, if a SCARF element decreases, avoidance responses are triggered.

SlideShare Presentation

“To achieve a goal you have never achieved before, you must start doing things you have never done before.” — Jim Stuart

During the past year, we have received many questions from clients about effectively deploying the ‘4 Disciplines of Execution’ (4DX). The concepts, based on the book of the same title by Chris McChesney and Sean Covey, have driven far more inquiries than any other newly emerging concept. In this post, we explore the key ideas related to 4DX, provide thoughts on integration with Ingrained Excellence, and offer tips on effective implementation that you can utilize in your organization.

What is 4DX?

4DX is a strategic deployment methodology designed to help executives focus and align the organization’s entire workforce. Because of this, it directly supports one of the ‘Four Musts’ of Ingrained Excellence: ‘Alignment and Focus.’ When properly implemented, 4DX can help ensure the needed execution to achieve the key strategic objectives of the organization.

McChesney and Covey define the four disciplines as follows:

Focus on the Wildly Important

Act on the Lead Measures

Keep a Compelling Scorecard

Create a Cadence of Accountability

 Next, we will explore each of these disciplines in more detail.

 Focus on the Wildly Important

According to McChesney and Covey, the purpose of this phase is to “focus your finest effort on the one or two goals that will make all of the difference, instead of giving mediocre effort to dozens of goals.” Focusing on only one or two “Wildly Important Goals” (WIGs), allows executives to align the organization’s collective energy on executing those critical few goals. When too many goals are present, the best of intentions get swept away by the “whirlwind” of urgent day-to-day activities.

A WIG is not a BHAG. In the book Good to Great, Jim Collins outlines a BHAG as a Big Hairy Audacious Goal. In Lean parlance, we view BHAGs as being synonymous with the ‘True North’ vision of a long-term ideal state. WIGs are specific and short-term in nature; they identify what is most important for the organization to achieve in the form of “from X to Y by when.” For example, a trucking company may define their WIG as reducing operating ratio from 92.7 to 87.3 by year-end.

It’s important to remember that high-level WIGs are designed by executives and then cascaded into progressively lower level WIGs across all levels of the organization. These lower level WIGs all correlate to the achievement of the highest level WIG. For example, the maintenance group of the trucking company may define their lower level WIG as “Reducing Maintenance Spend per Tractor from X to Y by Year End.”

Act on the Lead Measures

For goals to be successful, there have to be measurable guidelines to track progress. Directly measuring progress against WIGs provides a lagging, after the fact, indication of team standing versus goal attainment. In addition, the team should also define daily or weekly measures—these measures should be causal and influential in nature. When reviewing goal progress, team members should determine and take the necessary actions to positively impact the lead measures. Authors McChesney and Covey argue that their method provides a flexible just-in-time approach, compared to the traditional one-time activity of simply defining and deploying resources to execute a detailed plan of all activities needed to achieve the WIG.

By ensuring a goal is adaptable to environmental changes and marketplace modifications, there is a better chance of successful execution. Continuing with our trucking company example, the maintenance group may define ‘% of tractors receiving preventative maintenance within every X miles’, as a leading measure for their local level WIG. After the team identifies the lead measure, they should then – on a regular basis – define and act on the specific actions needed to positively influence the metric.

Keep a Compelling Scorecard

Visibility is a key component of goal attainment. To support WIG achievement, each team should develop a simple, highly visual dashboard displaying progress against the WIG. The board should also include the performance of the corresponding lead measures and status of activities to drive the leads in the appropriate direction.

By placing the dashboard in a visible area, everyone is able to keep up-to-date on whether or not the team is “winning.” This component directly aligns with the fundamental Lean hallmark of Visual Management.

Create a Cadence of Accountability

This discipline is “where execution actually happens.” The team should come together frequently, around the visual scorecard, to assess the actions taken thus far and to plan for future actions as they move forward. McChesney and Covey suggest the 20-30 minute sessions take place at least weekly; however, our experience shows that it is more effective when performed on a daily basis at the local level. Weekly accountability sessions are acceptable for higher levels of the organization. No matter the level or job titles, frequent accountability sessions keep the WIG in the forefront of everyone’s mind. This accountability is an extension of the common Lean practice of daily team huddles.

How Does 4DX Integrate with Ingrained Excellence?

As stated previously, 4DX directly supports one of the ‘Four Musts’ of Ingrained Excellence: ‘Alignment and Focus,’ by rallying the entire organization around the achievement of the one or two most critical objectives.

Additionally, Discipline 4: Create a Cadence of Accountability, links to another ‘Must’ of Ingrained Excellence – Must 4: Fundamentally Ingrain CI into the organization’s culture. Engaging front-line workers every day in taking action toward achieving the WIG cultivates an environment in which improvement becomes a daily habit of all workers. This ensures all workers, no matter the level within the organization, are continually focused on improving the way work gets done rather than viewing this as an additional set of bolt-on activities that must be accomplished. If this mentality is built within the organization, it can play a valuable role in achieving Ingrained Excellence.

Tips for Effective Deployment of 4DX

Although 4DX can play an integral role in Ingrained Excellence, here are several recommendations to support an effective deployment:

Define a common methodology and support structure for executing toward WIGs. While the authors suggest teams meet regularly to review progress and agree on next steps, they do not provide details on how to do this. We recommend integrating the practices of Improvement Kata and Coaching Kata into the ongoing accountability process.  This will provide a common methodology and the needed structure and coaching support to accelerate progress.

Deploy WIGs only into areas that impact them. Some businesses require all areas to be involved in the achievement of WIGs, whether or not they directly impact them. However requiring an area that cannot directly impact a WIG to participate drives wasteful activity. Workers forced to develop scorecards and attend accountability session linked to goals that they have little impact over can easily become jaded with the process. All business areas should develop ongoing improvement efforts, but if they do not directly impact a WIG, these efforts should be targeted on making progress toward moving a step closer to the long-term True North vision (e.g. achieving zero defects or one-piece flow).

Ensure mechanisms are in place to sustain the gains. McChesney and Covey explain that once WIGs are achieved, they are released back into the “whirlwind.” We contend that without continued attention, backsliding is very likely. Our recommendation is that critical lead measures be integrated into the ongoing Daily Performance Leadership process of the organization, a tool that allows the management of the daily whirlwind of business. This helps maintain the required level of day-to-day performance by ensuring an ongoing focus on the most critical factors impacting process outputs, and fostering continuous incremental improvement.

In summary, 4DX is a strategic deployment methodology that can play a fundamental role within Ingrained Excellence.  It can serve as a key tool for aligning and focusing the entire organization, and engaging everyone in the execution of the needed activities to achieve the organization’s most critical goals.  But to be successful, it must be deployed properly.

Recently, we've been exploring the current state of Continuous Improvement (CI) and why it typically doesn't deliver on its promises, with the intent of utilizing the lessons learned to generate the foundation of an improved CI model. In this post we synthesize the key takeaways from our research into the ‘four musts’ that form the basis of a more lasting and effective approach; a CI model that ingrains excellence deeply into every corner of the organization, generating ever increasing customer value, positive financial impact, and worker fulfillment.

The four musts of an improved CI model:

MUST 1: Build upon the proven most effective existing tools, methods, and concepts (Lean, Lean Six Sigma, 4DX, Kata, TWI, etc.)

The value of appropriately applying the tools, concepts, and philosophies from Lean and Lean Six Sigma is well proven. Any improved model needs to retain the elements that continue to deliver value, while addressing key gaps that inhibit long-term CI success.

We are not advocating a revolution, but there is a clear need for an evolution. In CI speak, we are now in the ‘adjust’ stage of the latest plan-do-study-adjust (PDSA) cycle for CI as a whole.

MUST 2: Deliver rapid and lasting results

While the end game of CI is to position organizations and their people for long-term success, we all know that in today’s short-term focused environment, positive results need to be delivered quickly. The faster and more effectively CI efforts address important process issues, deliver real dollars to the bottom-line, and begin to improve the welfare of the workers impacted, the more CI will be valued and the more likely it will attract additional attention and resources to build further momentum. Success begets success.

However short-term results also need to be long lasting. The shine will quickly wear off of CI if specific improvements fail to stick over time. CI needs to make results sustainment a natural byproduct of daily work, rather than an extra bolt-on set of activities.

MUST 3: Ensure focus and alignment

The entire organization needs to be able to focus efforts on executing the activities required to achieve the MOST CRITICAL short-term objectives, while still managing the typical chaos of the workday and delivering the expected daily numbers. The key here is making sure no one in the organization is accountable for more than one (or two at most) near-term critical objective. This is very different from the situation we typically see, in which leaders often times are on the hook for more than a dozen goals. From a Lean perspective, specifically Little’s Law, having lots of goals at any one time has the same effect as having too much inventory in a production process – There’s lots of activity, but nothing gets completed on time.

In addition to a razor sharp focus on only the most critical short-term issues, the organization needs to continually strive to make progress toward the direction of a common ‘true north’ supported by fundamental Operational Excellence Principles (this will be a subject of future blog posts).

MUST 4: Fundamentally ingrain CI into the organization’s culture

Our experience shows that if CI is positioned as a set of bolt-on activities to be performed in addition to the required daily work, it will eventually get swept aside. However when it is ingrained into the way work gets done every day – and becomes wired into individual habits and collective routines – it is much more sustainable and requires significantly less of the business non-value add support infrastructure utilized by most of today’s approaches.

Ingraining CI into the culture engages the combined horsepower of all workers in a daily cadence of problem solving – amplifying improvement momentum and yielding all of the benefits of increased worker engagement discussed in the last post.

Of course this is just an introduction to the foundational tenets of an improved model that we are labeling as ‘Ingrained Excellence’, with many specific details still to come. So stay tuned!

In the meantime, we welcome your thoughts. What resonates with your experiences? Are there additional gaps that still need to be closed?

Lesson Learned: To close the gaps of existing CI approaches, an improved model of Ingrained Excellence must:

In recent posts we explored issues that often negatively affect the long-term sustainability of Continuous Improvement (CI) efforts within organizations.  One item we've argued is that CI will fail over the long term if the entire workforce is not deeply engaged every day in the process.  With the understanding that deep engagement plays a critical role in CI success, in this post we want to delve more into what engagement means, its current state, and its impact on the bottom line.

What is engagement, anyway?

There are a lot of definitions out there, so let’s start with one that we will use:

Employee Engagement is the emotional connection between the organization and its employees to join together in an effort to continually improve all aspects of the organization and achieve its goals.

How engaged are employees today? 

According to Gallup’s State of the Global Workplace Report (2013):

“Currently, 13% of employees across 142 countries worldwide are engaged in their jobs — that is, they are emotionally invested in and focused on creating value for their organizations every day. As in Gallup’s 2009-2010 global study of employee engagement, actively disengaged workers — i.e., those who are negative and potentially hostile to their organizations — continue to outnumber engaged employees at a rate of nearly 2-1.”

According to Gallup, the engagement rates in the United States and Canada are the highest in the world, but even in those countries only 29% of employees are engaged in their jobs.

There is clearly a disengagement epidemic.

So why does engagement matter? 

According to the same Gallup report, the actual cost to the American economy alone is a staggering $450 billion to $550 billion per year.  Additionally, Aon Hewitt’s 2013 Trends in Global Employee Engagement study provides insight into how increased engagement can directly impact your company.

Aon Hewitt’s analysis shows a significant positive correlation (r=0.41, p-value<0.01, n=94 companies) between engagement and sales growth over one year, with an inferred cause-and-effect relationship due to the evidence of a positive correlation between employee engagement and higher levels of efficiency, quality, innovation, and customer service.  Their analysis indicates that for each 1% incremental increase in employee engagement, an incremental increase of 0.6% in sales could be expected, therefore a 5% increase in engagement would correlate to 3% increase in sales growth. 

For example, if we accept this relationship between engagement and sales growth, a $5 billion dollar company with a 55% gross margin and a 15% operating margin will see a $20 million increase in incremental operating income for each 1% increase in engagement.  It then follows that a 5% increase in engagement would yield $100 million incrementally; a 10% increase would lead to an incremental $200 million, and so on.  It should be noted that these increases transfer value directly to the bottom line!

In addition, another effect of poor engagement is increased employee turnover, which any HR person will tell you adds a cost of several thousand dollars to recruit and onboard each new employee, adding even more to the cost of not having a fully engaged workforce.

How do we cure this epidemic? 

While we will explore the answer to this question in much more depth in future posts, here are a few initial thoughts:

The first step is to recognize that it doesn't have to be this way.  The vast majority of new hires arrive ready to be engaged with the organization, its leaders, and their new colleagues – they are ready and willing to contribute value to your organization by applying their talents, skills and experiences.  But when their ideas and efforts are constantly rejected as being risky, threatening to the power structure, or simply not valued, they will soon simply find it easier to give up – disengage – than to bring their best to work.

We also strongly recommend that training and fully involving all employees in problem solving is one of the most important investments that you can make in developing employee engagement right from the start, when you are most likely to get the new hires’ insight and commitment.  All employees need to understand, be encouraged, and be expected to apply the Plan-Do-Study-Adjust (PDSA) cycle to everything they do.  PDSA skills create high levels of engagement by allowing employees to contribute their innate creativity to improve the organization while at the same time giving them a much-needed degree of autonomy over how they do their work.

In future posts we will introduce an improved CI model with employee engagement as a fundamental tenet.  Doing so will create a virtuous cycle  in which engaged employees will deliver higher levels of sustained improvement, increased worker fulfillment, and even more CI.

In our last post we discussed the nature of shortcomings due to the episodic nature of traditional project-based Lean Six Sigma.  Now we will further explore reasons why Continuous Improvement (CI) deployments often fade over time, expanding our discussion to other CI approaches like traditional Lean.  Don’t worry, there are answers out there, but first we need to examine what has not worked in the past in order to determine what will work in the future.

Historically, when Lean has been employed as a comprehensive system to maximize customer value via the elimination of waste and ingraining proper cultural habits, it has been sustainable, most notably at Toyota in the form of the famous Toyota Production System.  Our experience however, leads us to believe that many Lean deployments, not unlike Lean Six Sigma, share the same fate of a short shelf life without producing the expected results of true CI.  What happened?

Often times Lean is deployed and viewed as a collection of tools, only applied where and when it is convenient, such as 5S initiatives, implementation of Kanban systems, value stream mapping key processes, and so on.

Whether it’s deploying Lean simply as a collection of tools or having a Lean Six Sigma group of skilled “Belts” to perform strategic projects to address underperforming processes, the core issue is usually the same: improvement is often deployed as a ‘bolt-on’ or simply an addition to everyday work activities of the organization.

The problem, of course, is that if CI is something that is just an extra bolt-on, it can easily be swept aside when the going gets tough.  Every organization will face a number of never-ending crises that impact daily work, diverting attention from other, add-on activities that don’t help resolve the more immediate issues.

In essence, what is bolted on can be easily unbolted.  Evidence of this can be seen in the large number of Lean Six Sigma groups that have been disbanded over the last several years.

Why do organizations often go down this path?

Upon first examination, it is a seemingly easier and lower risk approach. Many times organizations feel they can just copy what works elsewhere expecting similar results.  For example, Toyota uses work cells and they get great results, so we should do the same and therefore expect the same results, right?  Not necessarily.

While it may not be a conscious decision, it is our experienced opinion that the bolt-on approach is also a path of least resistance for top leaders.  It doesn't require the commitment and hard work to change their own deep-rooted habits.  In other words, they can simply delegate the implementation to others underneath them – down through many levels of the organization – without it having much if any impact on their own day-to-day activities. 

Although these approaches and tactics might seem to promise great results at first, over time they will have a minimal effect on the overall culture of an organization.  What is needed is a new CI model that will deeply affect and ingrain long-term, sustainable organizational change.  Lean tools and Lean Six Sigma have their place, but long-term sustainable CI is not achieved by simply delegating the implementation of specific tools or by the deployment of a purely episodic, project-based path.  What is needed is an approach that engages everyone every day in the improvement effort and fully integrates continuous improvement into everyone’s day-to-day work activities. 

Again, in future posts we will talk more about how to make this transition, but for now we would just like to highlight why existing approaches continue to fall short of the mark.  What has been your experience with these issues?  Have you had experience with these bolt-on programs?  How did they work over the long term?

In this post we continue discussing the issues that often prevent Continuous Improvement (CI) deployments from living up to their promises, but now we will move our focus specifically to Lean Six Sigma – One of the most prevalent forms of CI over the last decade. 

Lean Six Sigma is a project-based, most commonly top-down approach where key issues (ideally linked to strategic objectives to correct underperforming processes) are first identified by top leadership, with the issues then being addressed by project teams led by skilled “Belts”.  The teams follow a standard roadmap – usually Define-Measure-Analyze-Improve-Control (DMAIC) – to identify the root causes and implement corresponding countermeasures to improve process performance.  These teams act like a kind of ‘strategic strike force’ to address the most pressing organizational issues.

While having personally been deeply involved with numerous corporate Lean Six Sigma deployments that have been credited for generating many millions and sometimes billions of dollars in bottom- and top-line benefits, we have observed that the deployments can be quite fragile.  More often than not, efforts fade away when a change occurs at the top of the organization and then the leader(s) championing Lean Six Sigma moves on.

Why does this happen?  One clue is the evidence that most leaders and employees don’t personally recognize the value of Lean Six Sigma.  For example, recently a major pharmaceutical company with hundreds of Black Belts and Green Belts and a Lean Six Sigma deployment credited for delivering more than a billion dollars of improvement conducted an internal survey of its leaders across all levels of the company.  The majority of those leaders stated that they did not personally see the value Lean Six Sigma provided to their areas of responsibility.  How is this possible?

This could have been due to a perception that project results were not being sustained over the long-term.  However, with this particular company, other supporting evidence showed that this was not the case.  If improvements are made and results are sustained, then what is the problem?

The primary issue appears to be the ‘episodic’ nature of a strictly project-based approach like Lean Six Sigma.

Improvement projects represent episodic bursts of activity in small areas of the business.  Some points to consider about project-based episodic improvement:

When a project is completed, the “belt” moves on and the team is disbanded.

Toward the end of the project, a Control Plan is handed off to local leadership who are supposed to use it to sustain the gains, but then nothing more happens until process performance wanes and then once again the process appears on the leadership team’s radar and is targeted for another project; often with years in between projects.

Only a small fraction of leaders and employees are involved at any one time.  For example, when there are tens of thousands of employees in any one organization, at most only a few hundred will be involved in a DMAIC project at any one time.

Over time, many other processes (and the people that drive them) may never be affected and the people who were once involved in an improvement project will have a tendency to view Lean Six Sigma as something that was done only in the past, since no recent improvement activity has occurred.

Don’t get us wrong, strategically focused improvement projects play a key role and are a necessary part of a larger CI system, but they are only one part.  What else is required to create a more sustainable CI model?

The answer is that there must be a transition from a purely episodic, project driven improvement to a true continuous improvement approach that engages everyone every day in improving how their work gets done.

In future posts we will talk much more about how to make this transition, but for now we just want to spotlight these issues and again ask for your insights.

In today’s world, the majority of larger companies (>$1 Billion in annual revenue) have some type of formal Continuous Improvement (CI) activity underway, most commonly in the form of Lean or Lean Six Sigma. With the majority of organizations active in CI, obviously the need for change is widely recognized.

While CI deployments often yield short-term successes, over the long haul results are usually less than stellar.

According to a recent Accenture study of 113 companies, each with over $1 Billion in annual sales:

More than 50% stated that their CI programs produced a minimal financial impact

More than 67% stated that their CI deployment needed a restart, a reevaluation, or a complete makeover

In another recent Bain & Company survey of 184 companies:

80% of respondents said their Lean Six Sigma efforts were failing to achieve the anticipated value

74% said they weren't gaining the expected competitive edge

A Manufacturing Performance Institute survey from 2010 also yielded similar information:

“75 percent of manufacturers claim to be lean, but they are not getting the increased sales per employee nor are they realizing the cost per employee of truly lean operations”

What’s going on here? There appears to be a consistently recognized need, but CI deployments often don’t live up to their promises. Why not? What is the secret to achieving long-term CI success?

Although this is a complex issue, there are answers. This blog is the opening of a series of posts that will examine where CI is today, why it typically doesn’t deliver on its promises, and what is required to produce the sustainable long-term impact that organizations have been expecting all along.

To begin with, we’d like your input. Have you been a part of a CI deployment that has failed to achieve expectations over the long run? What went wrong? What went right? What was missing? What would you do differently if you could do it again?